Frank Dafa Prioritises Lower Costs for Tanzania’s 15% Manufacturing Goal

What changed

Frank Dafa, the new Executive Director of the Confederation of Tanzania Industries, has made lowering costs his priority for Tanzania’s manufacturing sector.

The sector remains below the national target of contributing 15% of GDP. Dafa identified high production costs, expensive bank lending and VAT among the constraints holding manufacturing back.

Why it matters

The target will not be reached by ambition alone. Manufacturers need room to produce, invest and compete, and high operating costs squeeze that room before goods leave the factory.

Bank lending rates matter because manufacturers often need financing for machinery, stock and expansion. When borrowing is expensive, even a business with demand may postpone investment. Cutting production costs could therefore affect not just existing factories, but the pace at which new capacity is built.

VAT is also part of the cost question, although the specific treatment proposed is not yet clear. That leaves the next step with policymakers and industry: whether Dafa’s priority becomes a defined package of tax, finance and operating-cost changes, and whether it comes with a timetable.

The 15% goal is best understood as a test of execution. Dafa has identified the pressure points; the important question now is whether those pressures translate into practical reforms.